Trading at M&C Saatchi in the first four months of 2021 has been "stronger than anticipated", the group said today as it announced a £47 million financing arrangement.
The listed owner of the eponymous advertising agency, along with other divisions including M&C Saatchi Talk and M&C Saatchi Sport & Entertainment, said it believes its financial results for the full year will be ahead of consensus expectations, and it cited "robust" new-business performance.
M&C Saatchi's new revolving facility agreement with National Westminster Bank and Barclays Bank, worth up to £47million, will be provided on a three-year term, with two optional one-year extensions. The group said it offers the business "enhanced liquidity and long-term financing".
The new arrangement replaces an existing £33m revolving credit facility and £5m overdraft, which were due to terminate on 30 June 2021. M&C Saatchi said its current balance sheet remains strong, with net cash of £30m. It will announce its full-year results for 2020 at the end of June.
In the announcement this morning, M&C Saatchi highlighted new work across the group, including the first digital UK Census campaign, a performance marketing campaign for Tinder across Southeast Asia, and becoming the creative partner for Australian energy company Origin. New assignments include briefs from Lexus, Reckitt Benckiser, Sonos and Commonwealth Bank, the firm added.
The improved performance comes after a difficult period for the group, following the impact of Covid-19 and the accounting scandal dating back to 2019.
Shares in M&C Saatchi were suspended at the end of September – returning in December – after it failed to complete an audit of its accounting errors for the 2019 financial year before its deadline. The group had earlier admitted to £25.8m of accounting errors and misjudgements, with £14m of direct misstatements of profit before tax.
A slew of management changes at group level, including the promotion of Moray MacLennan to chief executive last November, followed the accounting scandal.